US Senate to Consider Bill Examining El Salvador's Bitcoin Experiment

The full U.S. Senate will vote on a bill looking to mitigate risks to the U.S. financial system from El Salvador's adoption of bitcoin (BTC) as legal tender, after the bill was passed out of committee on Wednesday.

The “Accountability for Cryptocurrency in El Salvador (ACES) Act” was introduced by Sens. James Risch (R-Idaho), Bob Menendez (D-N.J.) and Bill Cassidy (R-La.) on Feb. 16.

“As El Salvador has adopted [b]itcoin as legal tender, it’s important we understand and mitigate potential risks to the U.S. financial system,” Risch said in a statement on Wednesday. He added the legislation would require the State and Treasury departments, among other federal agencies, to mitigate risks such as potential empowerment of China and organized criminal organizations.

The bill would also ask the U.S. to monitor remittances from El Salvador.

El Salvador President Nayib Bukele expressed his discontent after the bill passed out of committee.

“Never in my wildest dreams would I have thought that the U.S. [g]overnment would be afraid of what we are doing here,” he tweeted on Wednesday afternoon.

El Salvador adopted bitcoin as legal tender last autumn, launching a government-backed wallet and offering incentives for bitcoin usage. Bukele also announced the country would raise $1 billion through a bitcoin-backed bond, though this issuance was delayed from its initial planned launch of mid-March.